Kabasheva N. V. PhD JSC of Financial academy, Kulbaeva B. M. Master's
Degree student.Karaganda Economic university of
Kazpotrebsoyuz, Kazakhstan
The factors that influence on the deposit
Commercial banks develop deposit policy first of all
because it allows to regulate, operate, rationally to organize relationship
between bank and its clients on attraction of money in deposits.
The uniform deposit policy identical to all commercial
banks doesn't exist as each concrete bank is unique and is under influence only
to it an inherent combination of the economic, political and social factors
defining its development.
Therefore at creation of
optimum deposit policy of commercial bank it is necessary to consider various
factors it defining. Along with the factors which are directly influencing
activity of commercial bank, it is necessary to consider its competitive
positions, a bank share in the market of deposits, etc. All following factors
are able to allow commercial banks to estimate the competitive positions and to
determine a place of operations by attraction of deposits in corporate strategy
of bank, and also to position commercial bank in the market of deposits.
The
macroeconomic situation makes direct impact on functioning of commercial banks,
on their financial state and carrying out bank operations. This influence
defines need of monitoring and an adequate assessment of macroeconomic risks
taking into account the possible directions of development of economic
processes in the long term.
For example, economic
crises negatively influence financial stability of clients that, in turn, it
conducts to outflow of money from commercial banks, to narrowing of their
deposit base and decrease in recoverability of the given-out credits. Economic
growth, on the contrary, promotes inflow of additional money to commercial
banks. In the conditions of economic growth the remains of means on deposit
accounts grow in banks, the revenue of the enterprises which is storing in
banks, the income of the citizens who are the main holders of term deposits
owing to what resources of banks increase.
The bank policy of
commercial bank (including deposit) is defined by the state monetary policy of
National Bank. The national Bank of the Republic of Kazakhstan pursues a state
policy, using known methods of regulation of the monetary and credit sphere
which standards of obligatory reserves, interest rates for operations, deposit
operations, refinancing of banks, operations in the open market with the state
securities, issue of bonds are.
Use of
various tools for realization of the purposes monetary credit policy allows to
speak about two main methods of regulation of the monetary and credit sphere:
method of a credit restriktion, i.e. restriction of deposit and credit issue
for the purpose of control of rates of inflation and a method of credit
expansion - expansion of deposit and credit issue for stimulation of economic
growth [1].
Banks acquire considerable
part of resources in the market. Therefore the condition of the financial
market, possibility of mobilization of means of investors and other creditors,
receiving the interbank credits have direct impact on formation of resource
base of banks, their deposit policy. Quite often resources borrow on security
valuable papers or by sale of valuable papers with the return repayment,
besides, sometimes banks should sell urgently valuable papers for ensuring
liquidity or delivery of the credits therefore passive operations as a whole
and deposit operations, in particular, depend on a state and securities market
development.
The state and extent of
development of the financial market allows commercial banks during the forming
and realization of deposit policy to consider alternative possibilities of
accumulation of the resource potential for ensuring smooth functioning and
profitable activity.
Legislative and standardly
legal base, defining and regulating bank activity, has direct impact on
possibilities of bank on expansion of volume of performed operations,
improvement of quality of management by assets, liabilities and risks, defines
an order of carrying out separate operations and the requirement to
professional qualities of top managers. Important value has improvement of the
legal base answering to modern realities and considering needs of participants
of the banking market.
The
political situation in the country has positive or negative impact on
attraction of resources by banks, their deposit policy. Political instability,
crisis of the power undermine trust to bases of statehood and to opportunities
of the state to regulate activity of financial intermediaries, adequately to
react to violation by them of the legislation and rules of business ethics. In
similar situations managing subjects and natural persons aren't inclined to
trust the income and savings to financial and credit institutes that is
reflected in volumes of the deposits attracted with them. In case of stability
of the political power and high trust to it from society the trust to the
institutes rendering financial services which activity is controlled by the
appropriate government bodies, increases. In this case inflow of money to a
banking system increases, there is growth of investments into national economy.
The competitive environment can't be reflected in nature
of activity of commercial bank, including the developing and realization of
deposit policy.
It would be desirable to pay attention on a financial
condition of subjects of economy, motivation of their behavior since in fact
they define at trends macrolevel in formation of resource base of banks, their
deposit policy, and also quality of their assets.
At simple citizens it is possible to allocate two main
types of behavior at implementation of purchases of expensive goods: aspiration
to receive goods or service immediately, on account of future income, or
accumulation of the necessary sum during certain, sometimes long, time period
for the subsequent purchase. These conditions create the corresponding cash
flows: on the one side, the bank has steady long-term deposits, with another, -
steady demand for the average and long-term credits. Thus, the motivation and
type of behavior of clients are the most important factor of formation of
deposit policy of bank.
Level of the income and
expenses of the population is an integral part of attraction of money in
commercial banks. If level of the income exceeds level of expenses, in this
case the population still has free money which they can put on deposits. And if
everything occurs in accuracy on the contrary, at the population doesn't remain
money which can be put in bank even if the bank conducts an aggressive policy
on attraction of money (high interest rates, prizes and draws etc.).
One more significant
factor of development of deposit policy is state of the economy and the social
sphere of the region in which the bank carries out the activity. Regional
specifics of functioning of bank are subject to influence: 1) the relations
which have developed in the region between bank and its clients; 2)
specializations of bank activity and profitability of its operations; 3) supply
and demand ratios on bank operations and services in this region; 4) level of
the interbank competition and saturation of the regional market specialized
financial and credit institutes.
The percentage policy of
the state and percentage policy of the commercial banks attracting funds of the
population in deposits depends on level and rates of inflation.
Thus, the state macro
environment, political system, the legal environment and the financial market,
and also the state monetary policy is created by the conditions defining the
environment for work of banks. The level of development of a banking system,
extent of bank regulation and the supervision, the accepted standards of
activity of banks, financial infrastructure, system of insurance of risks
characterize a condition of the environment of the banking business, which
conditions bank by all means has to meet.
When forming optimum deposit
policy of bank it is necessary to consider also and the internal factors
influencing deposit policy of commercial bank.
The size
of bank plays an important role in expansion of client base and increase the
deposit portfolio. The more the branch network and is more free
"access" to regions, then there is more opportunity at the population
to use services of this bank. The commercial bank diversifies the client base
and volume of deposits, offering banking services to corporate and private clients.
Thus in parallel both directions or only one of them can be develop. Priorities
when forming structure of clients can change, proceeding from an assessment of
dynamics of market conditions and establishment of a new strategic objective of
development of bank. It is necessary to consider that the structure of clients
of bank defines methods of calculation of overall risk of bank used by bank and
its degree.
Thus, the structure of
clients of bank has direct impact on deposit policy regarding definition of the
list of deposits (deposits), order conditions the money which is on deposit
accounts, methods of establishment and payment of percent, ways of distribution
of deposit services, technical registration of deposit operations and their
reflection on accounting accounts, etc.
The client base of bank
and its diversification define stability and stability of raised funds. Now
many banks actively compete for private clients, considering this area of work
as an important source of replenishment of resources and increase in terms of
attraction of money in deposits.
When developing deposit
policy the special attention is paid to creation of conditions for formation of
the long-term relations with investors, including use of various ways of
encouragement of those from them who throughout the long period of time remains
the client of this bank, and also to creation of group of personal managers for
work with big customers [2].
The range of operations
offered by bank and services at a certain stage of its functioning doesn't remain
invariable. It develops, adapting to changes of economic life and the financial
markets. Criterion in definition of types and characteristic features of
operations carried out by bank and services is their profitability and
competitiveness. Thus banks consider set of the factors, capable to have on
them impact: demand, the offer, prime cost, the price, stage of life cycle on
which there is a service and others.
One of
the important factors influencing deposit policy of bank, the competitive
environment is. The competition analysis which as it was noted above, is
carried out when developing deposit policy, has to have system and systematic
character quickly to react to changing conditions of the competitive
environment, having impact on made decisions regarding introduction of new
types of deposits, changes of conditions of existing deposits, introductions of
additional services for investors, improvement of the organization of deposit
process.
Correctly created
organizational structure of bank can significantly influence attraction of
money and increase in client base.
Commercial banks develop
and carry out a complex of actions for the purpose of attraction of financial
resources of managing subjects and natural persons in the turn. The most
important means of competitive fight for attraction of resources is the
percentage policy since income size on invested funds serves as essential
incentive to an investment clients of the temporarily available funds in
deposits (deposits).
The most admissible rates
on deposits of natural persons are established by the Kazakhstan Fund of
Guaranteeing Deposits together with the National Bank of the Republic of
Kazakhstan on the basis of the approved method of calculation of the most
admissible rates which as one of parameters considers an indicator of inflation
[2].
For example: the maximum
rates recommended for banks on deposits won't change in 2014, the Fund left the
maximum rates recommended for banks on deposits of natural persons at former
level. On deposits in tenge they make 9% per annum, in foreign currency - 4,5%
per annum.
As the deposit policy of
commercial bank is the integral element of bank policy which in turn includes
also credit and currency policy that, undoubtedly, on formation of deposit
policy a great impact have credit and currency policy. These types of policy
are connected among themselves. If in bank shortage of resources is observed,
the bank starts attracting actively money that further to place them. The
similar situation arises at shortage of currency. If in bank there is no
foreign currency, the bank can raise an interest rate for currency deposits and
by that to attract money in foreign currency.
The
successful deposit policy, as well as bank policy as a whole, directly depends
on employees working in bank, their professional readiness, qualification and
experience. Important factor of development of bank is professional competence
and experience of heads of bank, ability to plan, ability to analyze and to
quickly react to a changing situation in the market.
Important aspect of development and realization of
deposit policy of bank is the strategy of human resource management including
definition of desirable level of centralization of adoption of administrative
decisions, a regulation of an order of carrying out deposit operations through
the approved provisions and instructions, creation of the mechanism of the
current coordination of actions and decisions of heads of divisions, the
monitoring system behind performance of planned indicators and indicators of
current state of a deposit base. When developing deposit policy of bank’s
special attention is paid to risk management in the field of formation of a
deposit portfolio and management of. The basis of risk management is made by
continuous maintenance of necessary level of diversification of deposit
resources, and also a possibility of attraction of financial resources of other
sources. Maintenance of balance of liabilities of bank, including deposits,
with its assets on terms, the sums and interest rates it is caused by need of
ensuring sufficient liquidity and acceptable profitability of operations.
The done analysis of factors allows to draw a
conclusion that the optimum deposit policy of bank reflects priorities both
nation-wide, and individual policy of bank.
Literature:
1 . www.nationalbank.kz.
2 . "Pluses of bank deposits".
Millioner.kz
3 . Bukhadurovа M. N. abstract.
"Deposit policy commercial banks in relationship with the population"